ESMA Promotes Clarity in Communications on ESG Strategies

Why It Matters

Clear ESG disclosures protect retail investors from deceptive claims and support the EU’s broader sustainable finance agenda.

Key Takeaways

• ESMA releases second thematic note on ESG strategies.
• Focus on ESG integration and exclusion definitions.
• Guidance includes do's and don'ts for marketing.
• Aims to reduce greenwashing risk for retail investors.
• Provides concrete examples of good and poor practices.

Pulse Analysis

The European Union has positioned sustainable finance as a cornerstone of its long‑term economic strategy, and ESMA serves as the supervisory backbone ensuring market integrity. By publishing thematic notes, the regulator translates high‑level policy into actionable guidance for asset managers, distributors, and issuers. The latest note, released on 14 January 2026, zeroes in on ESG integration and exclusion strategies—two concepts that appear frequently in product literature but often lack a common definition. This move reflects ESMA’s commitment to pre‑emptively curb misinformation before it spreads across retail channels.

ESG integration typically involves embedding environmental, social, and governance criteria into the investment decision‑making process, while ESG exclusions refer to the deliberate omission of certain sectors or companies based on sustainability screens. The ambiguity surrounding these terms can be exploited, leading to greenwashing that erodes investor confidence. ESMA’s guidance does not prescribe a single taxonomy; instead, it demands transparent disclosure of the methodology, thresholds, and data sources used. By illustrating both compliant and non‑compliant marketing language, the regulator provides a practical checklist that firms can embed into compliance workflows.

For financial institutions, the note translates into concrete compliance obligations that intersect with existing EU regulations such as the Sustainable Finance Disclosure Regulation (SFDR) and the Markets in Financial Instruments Directive (MiFID II). Firms that adopt the recommended best practices can differentiate themselves in a crowded market, attract ESG‑focused capital, and avoid costly enforcement actions. Looking ahead, ESMA’s thematic series signals a broader trend toward granular, claim‑by‑claim supervision, suggesting that future disclosures will be scrutinized with increasing precision. Early adoption of clear ESG communication therefore becomes a competitive advantage as the industry evolves.

ESMA promotes clarity in communications on ESG strategies

ESMA promotes clarity in communications on ESG strategies 14 January 2026

Sustainable finance

The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, published today a second thematic note on sustainability-related claims, focusing on ESG strategies.

The note concentrates on ESG integration and ESG exclusions, as references to these strategies are often made by market participants and widely referenced in marketing communications directed to retail investors. 

ESG integration and ESG exclusions can mean different things to different market participants. Lack of transparency when using these terms poses a notable greenwashing risk to investors. The aim of the note is not to define these strategies, but to call on market participants to be clear about what they mean when referencing them.

Similarly to the first thematic note on ESG credentials, this publication offers practical do’s and don’ts for making sustainability claims. These are illustrated through concrete examples of good and poor practices that are based on observed market practices.

Further information:

Cristina Bonillo

Senior Communications Officer

[email protected]

14/01/2026

ESMA36-429234738-165

Thematic notes on clear, fair and not misleading sustainability-related claims: ESG strategies